Wednesday, April 6, 2011

Telaprevir, Boceprevir pricing in Europe....

Given the rather large sum of 22,000 euros or $31,271 to treat a patient with HCV in France (under the current expanded access conditions), some experts predict most European countries to restrict the drugs to patients who have failed previous therapy. With a short 2-3 year window of time, Both Vertex and Merck are anxious to recoup their costs and make a profit before the next generation of drugs hit the market. In an economic sense, this is as good a reason as any for commercial for-profit enterprises to charge a premium on their product, especially in an environment of limited competition. All this can lead one to speculate on how much the drugs will cost here in the States and, ultimately, who will have access.

Bloomberg. New hepatitis C drugs from Merck & Co. and Johnson & Johnson (JNJ) are being sold in France for 22,000 euros ($31,271) and more, a precedent some doctors say may limit access after the medicines are approved throughout Europe.

J&J and Vertex Pharmaceuticals Inc. (VRTX)'s telaprevir costs 22,000 euros under a French program for seriously ill patients for whom there is no other effective treatment on the market, according to patient association SOS Hepatites. Merck & Co. said its boceprevir costs 30,000 euros under the same program.

The price may drop once the drugs are approved for the broader market, Merck and J&J executives said. Still, the French model shows the new drugs may triple the cost of hepatitis C treatment, leaving England, Russia and eastern Europe likely to delay use or restrict which patients are allowed access, said Antonio Craxi, director of gastroenterology and internal medicine at the University of Palermo.

"It may be that we can't use it at all until the price comes down," Mark Thursz, professor of hepatology at Imperial College London, said in an interview at a conference in Berlin over the weekend. "It's not the best economic environment to launch an expensive new drug."

The U.K.'s National Institute for Health and Clinical Excellence may restrict the new drugs to patients who have tried existing treatments without success, Thursz said. The agency may also require genetic tests to determine whether patients are likely to respond to the medicines, he said at the meeting of the European Association for the Study of the Liver.

Italy and Spain also may delay or restrict use, Craxi said. Italy spends about 350 million euros a year on existing hepatitis C treatments, he said. "If you triple the cost, that would be more than 1 billion euros," he said.

Under Review

The new drugs are being reviewed by regulators at the European Medicines Agency. Both are scheduled for U.S. Food and Drug Administration hearings at the end of this month.

In France, telaprevir and boceprevir received special temporary authorization in December, under a program designed for seriously ill patients for whom there is no other effective treatment on the market, according to French pharmaceutical regulator AFSSAPS. This allowed the drugs to bypass the usual approval procedures, the regulator said.

About 500 patients are being treated in France now, said Michel Bonjour, spokesman for SOS Hepatites. The new drugs are prescribed together with the current standard therapy of interferon and generic ribavirin, and the total cost of a yearlong cycle of treatment may reach 45,000 euros to 70,000 euros per patient, Bonjour said in an interview. The cost is covered in full by France's national health insurance program.

'Cost Effective'

"It's not a good indication of price elsewhere," Patrick Bergstedt, senior vice president for vaccines and infectious diseases at Whitehouse Station, New Jersey-based Merck, said in an interview.

The very sick patients in the French program get 44 weeks of treatment with boceprevir, while a more typical course of therapy is 24 weeks to 32 weeks, he said. There's a "high likelihood" the eventual commercial price for a course of treatment will be less than the 30,000 euros Merck charges under the French program, he said.

"It's black and white that these drugs are cost- effective," Bergstedt said. "The challenge will be how do you stratify treatment, and how do you use these drugs responsibly to ensure the patients with the greatest need are treated first."

12-Week Treatment

Vertex, based in Cambridge, Massachusetts, referred questions to partner J&J, which will market telaprevir in Europe. J&J hasn't decided on a final price, said Isabelle Lonjon-Domanec, global medical affairs leader for telaprevir at the New Brunswick, New Jersey-based company's Tibotec Therapeutics unit.

Patients take telaprevir for 12 weeks together with standard treatment, then continue on the older standard drugs for a total of six months to a year of therapy.

Both new hepatitis C drugs are protease inhibitors crafted from the same technologies that led to discoveries in HIV research. Used in addition to existing therapies, they boost the chance of a cure from half of patients to between two-thirds and three-quarters of those treated, studies have shown.

In the U.S., the new drugs may be priced at $35,000 to $40,000, estimates Howard Liang, a Boston-based analyst at Leerink Swann & Co.

"A cure saves a lot of money down the road," Liang said in an interview. "It's a shock to physicians, but I think it can be justified because it's a cure."

Next Generation

Hepatitis C, spread through contact with infected blood, is a virus that often lingers as a chronic condition, causing nausea and exhaustion as it destroys the liver over the course of years or decades. About 170 million people are infected, according to the World Health Organization.

Meanwhile, the next generation of drugs with even higher cure rates and fewer side effects is likely to reach the market within three years, Liang said.

Swedish drugmaker Medivir AB (MVIRB) has said it expects to begin selling a competitor pill to be used with interferon by 2013. Boehringer Ingelheim GmbH, Gilead Sciences Inc. (GILD) and Bristol- Myers Squibb Co. are among a dozen companies aiming for drug cocktails to replace the existing interferon combination.

Looming competition leaves Merck, Vertex and J&J without much time to recoup their investment, said Charles Gore, president of the Geneva-based patient advocacy group World Hepatitis Alliance.

"There is no easy answer to this," Gore said in an interview. "We've got to have a way to give people access but incentivize the drug companies to research in this area."

To contact the reporters on this story: Naomi Kresge in Berlin at nkresge@bloomberg.net; Carol Matlack in Paris at cmatlack@bloomberg.net

To contact the editors responsible for this story: Phil Serafino at pserafino@bloomberg.net;